Interleukin-1( (IL-1) has been implicated as an effector molecule of (-cell destruction in autoimmune diabetes. IL-1 inhibits insulin secretion from pancreatic (-cells by stimulating the expression of inducible nitric oxide synthase (iNOS) that generates nitric oxide. IL-1 also induces co-expression of the inducible isoform of cyclooxygenase (COX-2) and overproduction of pro-inflammatory prostaglandins and their precursor arachidonic acid, as demonstrated by isotope dilution mass spectrometry. The current studies characterize the involvement of protease(s) in the signaling pathway of IL-1-induced iNOS and COX-2 expression. Biochemical and molecular studies were performed using the rat insulinoma (-cell line, RINm5F. A serine protease inhibitor, N(-p-tosyl-L-lysine chloromethyl ketone (TLCK) and a proteasome complex inhibitor, MG 132, inhibited Il-1-induced nitrite formation, an oxidation product of nitric oxide produced by iNOS, in a concentration-dependent manne r. Both TLCK and MG 132 also inhibited iNOS gene expression at the level of mRNA and protein. TLCK and MG 132 also inhibited IL-1 induced COX-2 enzyme activity (PGE2 formation) and COX-2 gene expression at the level of mRNA and protein. In human islets, the proteasome inhibitor, MG 132, also inhibited the formation of the products of iNOS and COX-2 enzyme activity, nitrite and PGE2 respectively. These findings suggested that the inhibitory action of TLCK and MG 132 on iNOS and COX-2 expression precedes transcription. The transcription factor, NF(B, is essential for activation of a number of cytokine-inducible enzymes and was evaluated as a possible site of protease action necessary for IL-1 induced co-expression of iNOS and COX-2. TLCK and MG 132 inhibited both IL-1 induced activation of NF(B and degradation of 1(B( by islets and RINm5F cells. These results implicate protease activation as an early signaling event in IL-1-induced inhibition of (-cell function.